Journal of Northeastern University(Social Science) ›› 2022, Vol. 24 ›› Issue (4): 16-26.DOI: 10.15936/j.cnki.1008-3758.2022.04.003

• Economics and Management • Previous Articles     Next Articles

Will the OFDI Increase the Leverage Risk Level of Enterprises? Typical Facts and Empirical Tests

ZHENG Yunhong, TAN Cong   

  1. (School of Business Administration, Northeastern University, Shenyang 110169, China)
  • Revised:2021-04-26 Accepted:2021-04-26 Published:2022-08-29
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Abstract: The complex and changeable external environment makes outward foreign direct investment(OFDI) of enterprises showing the typical characteristics of high leverage risk. Selecting two indicators of enterprise financial leverage risk and operating leverage risk to assess the level of enterprise leverage risk, use OFDI data of A-share listed enterprises, and test the conduction path of OFDI affecting Chinese enterprise leverage risk with the PSM-DID model. The study finds that OFDI increases the risk of enterprise financial leverage and reduces the risk of enterprise operating leverage. Financial leverage risk has been increased by increasing financing constraints, but the influence of R&D investment is not obvious. Operating leverage risk has been reduced by increasing total factor productivity and diversification. Further research also finds that OFDI of business services significantly affect the enterprise leverage risk and the enterprise leverage risk of greenfield investment is relatively high.

Key words: outward foreign direct investment; enterprise leverage risk; differences-in-differences

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